"No such loan shall exceed 65 per centum of the normal value of the farm mortgaged, said value to be ascertained by appraisal, as provided in section 10 of this Act. In making said appraisal the value of the farm for agricultural purposes shall be the basis of appraisal and the normal earning power of said farm shall be a principal factor."

(d) Paragraph "Ninth" thereof is amended by striking out "the rate of 8 per centum per annum" in the first and second sentences of said paragraph and inserting in lieu thereof "a rate not exceeding 6 per centum per annum".

SEC. 5. Paragraph "Seventh" of section 13 of the Federal Farm Loan Act, as amended (title 12, U. S. C. 781), is further amended to read as follows:

"To borrow money severally, or jointly and severally with one or more other Federal land banks, to give security therefor, and to pay interest thereon."

SEC. 6. Paragraph "Eighth" of section 13 of the Federal Farm Loan Act, as amended (title 12, U. S. C. 781), is amended to read as follows:

"To buy and sell United States Government obligations direct or fully guaranteed; and to purchase and acquire from the Federal Farm Mortgage Corporation notes and mortgages representing loans made by the Land Bank Commissioner pursuant to section 32 of the Emergency Farm Mortgage Act of 1933, as amended (title 12, U. S. C. 1016), upon farm property situated in the farm credit district in which said bank is located, and purchase money mortgages and contracts for the sale of farms held by the Federal Farm Mortgage Corporation in connection with the sale of farm property situated in such district: Provided, That no such note and mortgage, purchase-money mortgage, or contract shall be purchased pursuant hereto unless (1) the unpaid balance of the indebtedness represented or secured thereby, together with any indebtedness to the Federal land bank secured by a prior mortgage on the property, does not exceed 65 per centum of the normal value of the farm as determined upon appraisal made pursuant to the Federal Farm Loan Act; (2) the borrower acquires such stock in a national farm loan association, in addition to any available stock which he may already own, as may be necessary to constitute an amount equal to one share of stock for each $100 of the unpaid balance of the indebtedness represented or secured by the note and mortgage, purchase-money mortgage, or contract being purchased and acquired, together with the indebtedness secured by any prior lien on the property in favor of the Federal land bank; (3) the national farm loan association in which such stock is held elects the borrower to membership, if not already a member, and agrees to be liable for the indebtedness secured by the note and mortgage, purchase-money mortgage, or contract being purchased and acquired; and (4) the land bank takes such action, if any, as may be necessary to reduce the rate of interest on the indebtedness secured by the mortgage, purchase-money mortgage, or contract acquired or purchased to the same rate of interest the bank is charging on first-mortgage loans which it is then making."

SEC. 7. Section 13 of the Federal Farm Loan Act, as amended (title 12, U. S. C. 781), is further amended by adding at the end thereof the following new paragraph:

"Nineteenth. To permit any borrower to defer payment of the principal portions of installments on his loan in order that he may pay, in whole or in part, any indebtedness which is secured by a lien junior to the lien of the bank upon the farm land mortgaged to secure his loan."

SEC. 8. Section 19 of the Federal Farm Loan Act, as amended (title 12, U. S. C. 851-857), is further amended by striking out the last paragraph and substituting in lieu thereof the following:

"Notwithstanding any other provisions of this Act to the contrary, on and after the effective date of this paragraph, subject to the approval of the Farm Credit Administration, any Federal land bank may deposit with the farm-loan registrar of the district, and it shall be the duty of said registrar to accept, as collateral security for farmloan bonds, either originally or by substitution, (a) United States Government obligations direct or fully guaranteed, and (b) notes secured by mortgages or purchase money mortgages on farms, or contracts for the sale of farms; provided any such mortgage, purchase money mortgage, or contract constitutes a first lien on the farm, or its equivalent from a security standpoint as determined by the Farm Credit Administration, and the unpaid balance thereof at the time of acceptance is not in excess of 65 per centum of the normal value of the farm, as determined upon appraisal made pursuant to the Federal Farm Loan Act."

SEC. 9. The first paragraph of section 20 of the Federal Farm Loan Act, as amended (title 12, U. S. C. 861), is further amended by striking out the first two sentences thereof and substituting in lieu thereof the following:

"Bonds provided for in this Act shall be issued in such amounts, denominations, and bear such terms as the Farm Credit Administration may authorize; they shall have a specified maturity, but may, in addition, when stated in the bonds, be redeemable, at the option of the land bank, at an earlier specified date or dates."

SEC. 10. (a) The fourth paragraph of section 21 of the Federal Farm Loan Act, as amended (title 12, U. S. C. 874), is further amended by striking out the following: "of United States Government bonds, or first mortgages on farm lands" and substituting in lieu thereof the following: "prescribed by the Federal Farm Loan Act, as mended".

(b) The tenth paragraph of section 21 of the Federal Farm Loan Act, as amended (title 12, U. S. C. 880), is further amended by striking out the following: "consisting of obligations of the United States Government, or first mortgages on farm lands" and substituting in lieu thereof the following: "prescribed by the Federal Farm Loan Act, as amended".

1

SEC. 11. The fourth sentence of section 32 of the Emergency Farm Mortgage Act of 1933, as amended (title 12, U. S. C. 1016 (c)) is further amended by striking out the following words: "interest on unpaid principal at a rate of not to exceed 5 per centum per annum" and substituting therefor the following words: "interest on

unpaid principal at a rate of 1 per centum per annum higher than the rate on loans through national farm loan associations made at the same time by the Federal land bank in the farm credit district in which the security for the loan under this section is located: Provided, however, That loans guaranteed under title III of the Servicemen's Readjustment Act of 1944 may be made at such lower rate as may be necessary to qualify them for such guaranty".

SEC.. 12. Section 32 of the Emergency Farm Mortgage Act of 1933, as amended (title 12, U. S. C. 1016), is further amended by adding after the fourth sentence thereof a new sentence reading as follows: "The instruments under which each loan under this section is made and security given therefor shall provide that if at any time it shall appear to the lender that the borrower may be able to obtain a Federal land bank loan on the mortgaged property, the borrower shall, on request of the lender, apply for a Federal land bank loan to pay off the loan under this section, and shall accept such loan as may be offered to him by the Federal land bank, if sufficient in amount to pay the loan under this section and pay for any stock which it is necessary for him to purchase in obtaining the loan from the Federal land bank".

SEC. 13. The tenth sentence of section 32 of the Emergency Farm Mortgage Act of 1933, as amended (title 12, U. S. Č. 1016), is amended by striking out "July 1, 1945" wherever it appears therein and inserting in lieu thereof "July 1, 1946".

SEC. 14. The last two sentences of section 3 of the Federal Farm Mortgage Corporation Act (title 12, U. S. C. 1020b) are hereby amended to read as follows:

"The Federal Farm Mortgage Corporation is authorized to repay to the Secretary of the Treasury on behalf of the United States all amounts in excess of $50,000,000 heretofore subscribed to the capital stock of the Corporation. The proceeds of such repayment shall be held in the Treasury of the United States as a fund available for subscription, by the Governor on behalf of the United States with the approval of the Secretary of the Treasury, to the capital of the Corporation when, in the judgment of the directors of the Corporation, additional subscriptions to its capital are necessary."

SEC. 15. Section 4 (b) of the Federal Farm Mortgage Corporation Act, as amended (title 12, U. S. C. 1020d), is further amended by adding at the end thereof the following:

"The Corporation is authorized and empowered to sell and assign, without recourse and without warranty, its notes and mortgages representing loans made by the Land Bank Commissioner pursuant to section 32 of the Emergency Farm Mortgage Act of 1933, as amended (title 12 U. S. C. 1016), to the Federal land bank located in the farm credit district in which the mortgaged farm properties are situated and to sell and assign in like manner purchase money mortgages and contracts for the sale of farms held by the Federal Farm Mortgage Corporation in connection with the sale of farm property situated in such district."

SEC. 16. Section 502 of title III of the Servicemen's Readjustment Act of 1944 is amended by inserting after the comma following the word "applicant" and before the words "may be approved" the follow

ing: "or to purchase stock in a cooperative association where the purchase of such stock is required by Federal statute as an incident to obtaining a loan on which a guaranty is sought,".

SEC. 17. The sections, subsections, paragraphs, and provisos of this Act are hereby declared to be separable, and if any one or more of the sections, subsections, paragraphs, or provisos of this Act, or the application thereof to any person or circumstance, should be held to be unconstitutional or invalid for any other reason, the validity of other sections, subsections, paragraphs, and provisos of this Act, and the application thereof to other persons or círcumstances, shall not be affected thereby.

SEC. 18. The right to alter, amend, or repeal this Act, or any part thereof, is expressly reserved.

SEC. 19. This Act shall become effective on July 1, 1945.
Approved June 30, 1945.

[PUBLIC LAW 248-79TH CONGRESS]

[CHAPTER 557-1ST SESSION]
[H. R. 3660]

AN ACT

To provide for financial control of Government corporations.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That this Act may be cited as the "Government Corporation Control Act".

DECLARATION OF POLICY

SEC. 2. It is hereby declared to be the policy of the Congress to bring Government corporations and their transactions and operations under annual scrutiny by the Congress and provide current financial control thereof.

TITLE I-WHOLLY OWNED GOVERNMENT

CORPORATIONS

SEC. 101. As used in this Act the term "wholly owned Government corporation" means the Commodity Credit Corporation; Federal Intermediate Credit Banks; Production Credit Corporations; Regional Agricultural Credit Corporations; Farmers Home Corporation; Federal Crop Insurance Corporation; Federal Farm Mortgage Corporation; Federal Surplus Commodities Corporation; Reconstruction Finance Corporation; Defense Plant Corporation; Defense Supplies Corporation; Metals Reserve Company; Rubber Reserve Company; War Damage Corporation; Federal National Mortgage Association; the RFC Mortgage Company; Disaster Loan Corporation; Inland Waterways Corporation; Warrior River Terminal Company; The Virgin Islands Company; Federal Prison Industries, Incorporated; United States Spruce Production Corporation; Institute of Inter-American Affairs; Institute of Inter-American Transportation; Inter-American Educational Foundation, Incorporated; Inter-American Navigation Corporation; Prencinradio, Incorporated; Cargoes, Incorporated; Export-Import Bank of Washington; Petroleum Reserves Corporation; Rubber Development Corporation; U. S. Commercial Company; Smaller War Plants Corporation; Federal Public Housing Authority (or United States Housing Authority) and including public housing projects financed from appropriated funds and operations thereof; Defense Homes Corporation; Federal Savings and Loan Insurance Corporation; Home Owners' Loan Corporation; United States Housing Corporation; Panama Railroad Company; Tennessee Valley Authority; and Tennessee Valley Associated Cooperatives, Incorporated.

SEC. 102. Each wholly owned Government corporation shall cause to be prepared annually a budget program, which shall be submitted

71-491 O-66-17